What 141 CIOs and $765 Billion in Capex Tell Us About Where B2B Software Is Headed: The Latest From Redpoint

Redpoint Ventures just put out their latest 70-slide market update this month that is one of the most data-dense look at where B2B software actually stands right now. I read the whole thing. Here are the 10 learnings that matter most for B2B + AI founders and operators.

1. Public SaaS Multiples Are at 4.1x NTM Revenue — the Lowest Since 2008

The median NTM revenue multiple for public SaaS companies is currently 4.1x. The peak in 2021 was around 22x. That is an 80% contraction in what the market is willing to pay for a dollar of forward software revenue.

What is driving this is not current-quarter results. The Redpoint data makes a sharp point here: in a typical SaaS DCF, roughly 85 to 95% of enterprise value comes from terminal value, not near-term cash flows. Investors are not debating this quarter. They are pricing in whether AI compresses long-term growth rates, moats, and addressable markets permanently.

2. Software Stocks Are Down 20% YTD While Energy Is Up 32%

Year-to-date total returns across S&P 500 sectors show software sitting at negative 20%, making it by far the worst performing sector. Energy is up 32%. Materials up 5%. Consumer staples up 4%. Even IT broadly is only down 11%.

The differentiation within software is stark. Horizontal SaaS is down 35% over the last twelve months. Vertical SaaS is up 3%. Infrastructure is up 2%. The market is expressing a view that horizontal software — tools built to serve every industry equally, which often means deep integration with none — is the most exposed category as AI rewrites the coordination and workflow automation problem.

3. 54% of CIOs Are Actively Pursuing Vendor Consolidation, and 45% of AI Budgets Are Replacing Existing Software Spend

Redpoint surveyed 141 CIOs in March 2026. The numbers are not friendly to incumbents. This may be the most important learning for founders & B2B execs.

• 54% are actively pursuing vendor consolidation.
• 45% say their AI budgets are coming directly out of existing software line items, not new budget.
• Only 3% expect AI to lead to more vendors overall.
• 58% say AI feature additions are the number one driver of software spend increases — the highest of any category surveyed.

The practical implication is that AI spending is largely zero-sum for the existing software stack. When a company buys an AI tool, it is often canceling or reducing something else.

4. 83% of CIOs Are Open to Replacing Their CRM with an AI-Native Vendor

When asked which software categories they are most open to replacing with an AI-centric alternative, CIOs ranked Salesforce Automation first at 83%. Customer service management was second at 56%. ITSM at 55%. ERP and procurement tied at 50%.

The categories at the bottom of the list — finance operations at 14%, DevOps at 19%, project management at 19% — are either deeply embedded in technical workflows or carry too much integration complexity to move quickly.

5. AI-Native Companies Are Generating 10x More Revenue Per Employee Than Legacy Software

ARR per full-time employee at current levels: Cursor is at $6.1M per FTE. Lovable is at $3.4M. OpenAI is at $1.5M. Anthropic is at $1.2M. Salesforce is at $0.54M. Datadog at $0.51M. ServiceNow at $0.49M. Atlassian at $0.46M.

This is not a marginal efficiency gap. Cursor is generating 12x more revenue per person than Salesforce. This data point has significant implications for how we think about what a B2B software company should look like structurally.

6. Private Market Series B/C Multiples Are at 61x ARR, While Public High-Growth Software Trades at 9.7x

The spread between private and public software valuations is historically extreme. Median Series B and C ARR multiples in 2026 YTD are 61.1x. Public high-growth software trades at 9.7x LTM revenue. That is a 528% premium for private over public.

The market is effectively saying that private AI-native companies at Series B/C deserve massive premium multiples because their growth rates are in a completely different category than anything public markets have seen.

7. Among Companies That Have Reached $50B+ Valuation … the Recent Cohort Got There in a Median of 9 Years vs. 23 Years for Earlier Generations

Pre-2000s cohort: 23-year median to $50B. The 2000s cohort: 16 years. Post-2000s cohort: 9 years. And within that last cohort, Anthropic hit roughly $50B in 4 years. Cursor did it in 4 years. xAI did it in 1 year.

8. The AI Application TAM Is $6.1 Trillion If Agents Move Beyond Task Execution

Redpoint lays out the agent maturity curve across four stages: copilots, task agents, workflow agents, and fully autonomous systems. The addressable market grows at each stage.

US software spend alone is $0.5T. If AI penetrates knowledge worker payroll, the total addressable market is $6.1T+. Even 5% AI penetration of that number exceeds the entire existing US software market.

9. 44% of All Enterprise Software VC Dollars Are Now Concentrated in the Top 20 Deals

In 2020, the top 20 deals represented 8% of all enterprise software VC funding. By 2025, this jumped to 44%. Capital is concentrating into a handful of names — almost entirely foundation model labs and infrastructure plays like OpenAI, Anthropic, and xAI.

10. AI Is Creating More Demand for Software Engineers, Not Less

Indeed job postings for software engineers have diverged sharply from total job postings in early 2026. While total job postings are down, software engineer postings are showing resilience as companies race to build AI capabilities.